8
Manufacturing sites across North America
Asset Portfolio Optimization: From Strategy to Value Creation Execution
The company faced severe capacity constraints, with two sites operating at only 60% utilization while demand surged. Working together with investors, we transformed underperforming operations through strategic asset relocation and operational excellence. This partnership delivered a remarkable valuation increase, from $186 million to $752 million in less than one year.
Industry: Private Equity
Service: Manufacturing
Service: Operational Excellence
Service: Operations Strategy and Transformation
Our Client
The company designs, manufactures and supplies high-performance components and subsystems for radio frequency, microwave and electromagnetic spectrum applications.
The company serves critical aerospace, defense, industrial and communication sectors with electronic devices—requiring extremely high quality and reliability. Operating across seven US sites, plus Mexico, the company produces everything from low-complexity high-volume products to sophisticated hybrid microelectronics.
7
US locations plus Mexico facility
30-40%
Mexico facility utilization before project
ISO 8
Clean room certification achieved
“This project sparked the company's transformation, showcasing operations capability and boosting an appetite for change
“
The Challenge
By late 2023, the company faced critical operational challenges threatening profitability and growth potential despite strong commercial performance from its new leadership.
- Severe capacity constraints: Two of its US sites operated at approximately 60% utilization, producing only 2,700 units against 6,000 units of demand. This backlog placed tremendous pressure on management teams who had successfully increased sales but could not deliver on commitments, risking market credibility.
- Margin deterioration: One site demonstrated the lowest performance across all sites with negative margins around 30%, despite producing high, medium and low-complexity products at full capacity. The site’s EBITDA of $0.8 million represented only 4% margin compared to the company average of 34%.
- Operational inefficiencies: Despite being in an industry requiring high automation, both underperforming sites operated with old, mostly manual equipment. The company had no experience in operating hybrid or microelectronics production in lower-cost locations such as Mexico, limiting its strategic options for improvement.
Real Results Achieved Together
The asset portfolio optimization program transformed the company’s operational footprint through strategic production relocation and capability building.
Working alongside plant teams in the US and Mexico, the implementation created a high-performance manufacturing network that fundamentally changed the company's value proposition.
4x
Enterprise value growth
75%
Backlog reduction achieved
250%
EBITDA increase delivered
50%
Additional capacity created
Transformation Impact
- Reduced time-to-competency for hybrid production from 90 days to 40 days
- Built ISO 8 clean room from scratch in four months with optimized lean layout
- Filled all critical positions with upgraded talent while achieving 20% FTE reduction
Our Approach
The transformation began with EFESO’s operations relocation framework, addressing four critical components:
- Strategic direction
- Commercial plan
- Operations & supply chain plan
- Support functions plan
During the three-week analysis phase, we expanded an initial equipment plan into nine comprehensive workstreams with 470+ tasks and 14 workstream leads.
The implementation featured weekly steering committee meetings with the investor’s operating partner and the client’s CEO for quicker decision-making. Our aerospace and defense expert maintained a continuous on-site presence—first at one of its US sites for planning, followed by five consecutive months in Mexico during transfer operations. We deployed Smartsheet for real-time project tracking, enabling all stakeholders to monitor progress transparently.
The partnership combined EFESO’s aerospace expertise and bilingual team with the client’s deep product knowledge and engineering capabilities. This “One Team” approach ensured seamless coordination between sending and receiving facilities. This was particularly critical during ramp-up, quality management and troubleshooting phases.
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Facing Similar Manufacturing Network Challenges?
- Struggling with capacity constraints while demand exceeds your ability to deliver
- Seeking to optimize your asset portfolio and improve margins across multiple sites
- Ready to transform underperforming operations into competitive advantages through partnership
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